JBS Australia chief executive Brent Eastwood was the lone voice from Australian red meat processing sector and the broader commercial food manufacturing industry asked to attend Thursday and Friday’s Federal Government Jobs Summit in Canberra.
His verdict? A positive start, but much more remains to be addressed in order to counter the chronic shortage of labour being experienced across red meat processing – one of the largest regional employers in the nation.
Mr Eastwood said one of the challenges was that the meat industry’s labour problems were critical now – it was not an issue that was still over the horizon.
“The labour shortage issue is already an extreme burden – at a time when the industry’s capacity is rebuilding after drought, meaning it will only get worse,” he said.
“Next year when the herd and flock have further recovered, the labour shortage problem will only intensify. We won’t have the people available to process them. Our industry will need a lot more personnel to adequately handle the growing number of slaughter cattle and sheep.
“We need action now,” he said. “There needs to be immediate actions which delivery outcomes, whilst we also look at the medium and longer term solutions to providing skills and jobs for Australians.”
“But we are a country that is going to have to rely on migration – and one of the messages Mr Albanese and Mr Chalmers kept pushing last week was that they are more in favour of long-term moves to permanent migration, rather than short-term quick-fixes.”
Last week’s Canberra Jobs Summit brought together employers, unions, government and industry stakeholders to discuss pressing issues for all Australian’s and the economy.
As CEO of Australia’s largest food company with 14,000 employees nation-wide, Mr Eastwood said JBS took its food industry leadership seriously and the issues it raised during the event reflected the challenges for the animal protein sector.
“I applaud the initiative of the government to convene the summit, but that it itself won’t solve our immediate problems,” he said.
Mr Eastwood made two key points during the meeting.
The first was the need to get the backlog of current visa applications processed as a matter of urgency. The Government told Friday’s meeting there were 900,000 visas awaiting processing (said to be down from one million when the Albanese government started).
That number covered a diverse base, however – not just ag visas. It includes students, holiday makers and working visas of various types. The impression given was that there has been a massive rise in student visa applications recently.
“We (Australia) need to get far more efficient at getting these visas approved, for skilled and other workforces,” Mr Eastwood said.
The Government on Friday accepted that visa delays was a ‘real issue’, committing to putting on 500 extra personnel, under a $36 million funding allocation, to catch up with visa processing as a matter of urgency.
“But it’s not as if these visas access issues have appeared out of nowhere. It’s been a problem for a long time,” Mr Eastwood said.
“There was also an acceptance that controlled skilled migration is good for all growth – skilled jobs in engineering, computer skills, trades – not just agriculture,” he said.
“There’s a growing acceptance around the room on Friday that we are desperately short of labour, and controlled migration does not simply take jobs from Australians.”
Mr Eastwood’s second key point related to agriculture’s use of the Pacific Australia Labour Mobility (PALM) Scheme.
“The PALM scheme has been good for the majority of employers, who have used the system in an appropriate way. Without it, labour shortages would have been even more challenging,” he said.
“But we lobbied for improvement in postcode exemptions, because there are a lot of areas in JBS’s (and others’) businesses, where postcode location restrictions ruled out PALM workers.”
“We (JBS) are essentially in the ag sector, whether it be beef, pork or salmon. But we are also in manufacturing. The PALM scheme needs to make sure it covers those industries that are joined to ag, such as abattoirs that are on the urban fringes, and not necessarily in rural or regional areas,” he said.
“Up to now, those postcode exemptions have been inconsistent.”
Mr Eastwood said the Federal ag minister Murray Watt was very conscious of the anomaly.
“I have found him very connected to the issues, and understanding of the particular challenges being faced by meat processors. But as the minister responsible for agriculture, he obviously cannot wave a magic wand in areas like labour.”
He welcomed Friday’s formation of a tripartite working group (see Friday’s story) involving the government, unions and industry with aim of making sure agriculture has access to the increased migration numbers. Agriculture minister Murray Watt said the idea was about working cooperatively on the issue.
Enterprise bargaining discussion
Relating to discussions led by Union representatives and others during the summit about cross-employer enterprise bargaining, Mr Eastwood said EBAs had been a part of the red meat processing industry since 1996. He pointed out that the announcement said that those companies that already had EBAs on site should carry on as normal.
“But in principal, a cross-sector, cross-employer EBA model would be a setback 30 or 40 years,” he said.
“We all accept that the EBA system, like all models, has some shortcomings. But to talk about changing that, unilaterally, and putting something in that was worse makes no sense – for employees, or employers,” he said.
“Every employer in the room on Friday said that was not the right direction, and should not be rushed through,” Mr Eastwood said.
“In the beef processing industry’s case, every single site has a unique set of circumstances and challenges. No two are alike.
“We all accept that we need sustainable wage growth in this country – but to achieve that, we need sustainable productivity growth. The two go hand-in-hand, and EBA’s are a good opportunity to try and find areas on a processing site where productivity growth can happen. But to just give unilateral wage growth without productivity gain makes no sense.”
Mr Eastwood said Friday’s initiative to try to simplify and make more fair the ‘Better-off, overall test’ (BOOT), was a good initiative.
“New Zealand, for example, took the strategy to increase the threshold under which retirees could earn income without affecting their super. They increased it by $4000, but it was not enough. If it was higher, it would allow older workers to come back into the workforce – both skilled and unskilled jobs, if those chose to.”
The summit heard that for many recent Australian retirees, their super had been undermined by recent stock market performance, and some were keen to re-enter the workforce, to some degree.
But flexibility would be key for that to happen, Mr Eastwood said.
“Some might want to work only one, two or three days a week. But there is some opportunity to do that, especially in the bush, because many bring their accommodation with them, as grey nomads.”
He also supported the discussion around addressing skills deficits by subsidising fee-free TAFE training with an extra 180,000 positions, under a $1.1 billion government package, and the lifting of the permanent migration threshold to 195,000 people.
“We believe it is still not enough, and should be higher than that – but let’s get the visa issues solved first,” he said. “Everybody talks about ‘skilled’ migration, and that is critically important. But our red meat industry can also accommodate the unskilled and semi-skilled worker as well.”
The summit also spent time discussing better workforce inclusion of females, and with that, greater workplace hours flexibility.
“Flexibility or working hours is something that employers need to focus on more,” Mr Eastwood said.
“We need to better understand individuals’ circumstances, that might allow us to free-up more labour among people who for various reasons cannot work five days a week, eight hours a day.
That could be through job-sharing, or working x-amount of hours a day to cater for child caring or other commitments. Our industry needs to find ways to be more accommodating, and flexible, to allow us to access that group of workers who might normally be left out of our businesses because we are looking for full-time.”
Mr Eastwood said his own company, JBS Australia, currently had 1700 job vacancies across the country.
“The immediate need for workers is real, and if not addressed as a priority by the Federal Government, could impact food security and the viability of businesses along the supply chain,” he said.
“Across our business especially within our regional and rural based operations we are facing a real challenge to recruit and retain people in a highly competitive labour market. Even with unemployment at record lows, we continue to recruit locally where we can, and work collaboratively with local stakeholders and unions around responses to the jobs crisis across Australia.
“Food manufacturing and meat processing is an essential industry for Australia. We invest in Australia and are a significant employer and exporter.
“We’re hoping the outcomes from the summit will result in real immediate actions and a blueprint of short and long-term Federal Government commitments that will deliver positive outcomes for Australian businesses, our people and economy.”